Below this post you will find updated charts of the Rydex Cash Flow ratio and the flow of cash into Rydex bear funds courtesy of Decisionpoint.com.
The cash flow ratio has exceeded the level it reached at the Katrina low which was 1199 electronic for the December S&P futures contract. This shows a higher level of bearishness at 1222 today than at 1199 a month ago. Notice too that the cash flow into bear funds is at a record high.
Both charts tell me that a significant drop from current levels is highly unlikely.